- Associated Press - Wednesday, August 5, 2015

RALEIGH, N.C. (AP) - A nearly $3 billion bond package that would go to North Carolina citizens this fall received tentative House approval Wednesday, with supporters plugging low interest rates and the state’s future needs over colleagues generally opposed to debt.

By a 79-30 vote, the chamber got behind the bipartisan measure that would borrow essentially the same amount of money that GOP Gov. Pat McCrory wants to borrow. McCrory’s plan would split proceeds almost evenly between roads and government infrastructure.

But House Republicans, in a move attempting to attract Senate counterparts to the plan, shifts more of the $2.86 billion in proceeds toward building projects such as K-12 schools and higher education campuses, leaving $400 million for road building. Senate Republicans are down on borrowing for highway projects, preferring instead to pay for more of them with cash.

House GOP leaders say they’re willing to follow the Senate by halting the annual $216 million transfer of highway funds to general government operations and using those funds over six years for more road building. This pay-as-you-go proposal is separate from the House bond legislation. Another House vote was required Thursday before the legislation moves to the Senate.

Rep. Dean Arp, R-Union, who is shepherding the borrowing package through the House, said the state should take advantage of interest rates currently close to historic lows and avoid rising construction costs. Arp said the additional borrowing can be repaid over 20 years with existing state finances. No tax increases are anticipated.

“I think the time is right because of the financial health of the state,” Arp told colleagues. “I think the time is right because this is a wise financial plan.”

Rep. Mark Brody, R-Union, one of 21 Republicans who voted against the package, said he’s opposed to debt and urged colleagues to avoid borrowing just to spend money.

“We found a credit card with zero balance on it,” Brody said. “We can’t resist spending it.”

And the state’s automatic corporate income tax cuts in 2016 and 2017, along with the end of the Highway Fund transfer, worries Rep. Mickey Michaux, D-Durham. He said these and other changes result in a loss of $1 billion that could help pay the debt service.

But 31 of the 40 Democrats present Wednesday voted for the debt proposal. Rep. Ken Goodman, D-Richmond, said sometimes debt is a good, responsible action to take. Prosperous businesses take on debt to help grow, and the state can do the same thing.

“This is a good bill that makes good business sense,” Goodman said.

Some House bond proceeds would require counties to put up matching funds, particularly for getting a portion of the $500 million in K-12 construction funds. But poor school districts would have to put up less per dollar than other districts.

The measure would still set the statewide referendum for Nov. 3, even though no statewide vote is otherwise scheduled and House Speaker Tim Moore, R-Cleveland, said earlier this year he preferred a vote early next year. McCrory wants the November date and legislators to reimburse counties the cost of opening all of their voting precincts when there are usually municipal races on the ballot.

Copyright © 2018 The Washington Times, LLC.

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